Short Term Rentals are the Biggest Revenue Source for Maui County Real Property Tax FY22-23
Property Tax Revenue FY2022-2023
This fiscal year Maui County’s operating budget is the largest ever set at $1.07 Billion dollars, and for the first time will be going into the billions of dollars. This will be over a $200 Million increase, or 27% over last fiscal year. Read more about the budget here. The way the County of Maui sets the real property tax, the largest source of revenue for their budget, is to first figure out how much they plan to spend in the upcoming year, and then setting the real property tax figure to balance the budget.
In all, the county will raise $430 Million in property tax revenue. Vacation Rentals will raise $160 Million in RPT tax, 12% more than last year. This was an increase of $17 Million in tax dollars, the highest increase in all the tax classifications. This year Short Term Rentals represents 37% of the real property tax revenue, and 15% of the total operating budget.
Much of the increases in revenue in property taxes overall came from the increase in values of properties. Total assessments rose $4 Billion overall in Maui County in fiscal year 2022-2023. Increases in assessed values were 5% overall in the short term classification. Short term rentals will contribute $12.1 Million in revenue to the Affordable Housing Fund, the largest contribution of all the classifications, and the largest contribution to date. Over the last 5 years the short term rental classification has generated $31.5 million dollars for the affordable housing fund.
Visitor accommodations raise 82% of Maui’s property tax revenue with second homes included. These numbers show Short term rentals are a significant contributor to the County of Maui, and a legitimate and critical part of the economic engine for Maui.